Cashflow Forecasting Against Programme
Risk mitigationOngoingFor Subcontractors & Main Contractors
I build your cashflow forecast from the programme and the payment terms before works start, then maintain it monthly against actual progress and actual certification. Doing profitable work and having the cash to do it are two different problems, and the second one is the one that closes companies.
The problem
Most small contractors forecast cash by looking at the bank this morning and hoping, because nobody translates the programme and the payment terms into money and time. So the working-capital hole every front-loaded job digs stays invisible until payroll is tight. The job causing the squeeze is usually a good one: profit is earned when the work is done, but cash lands a month or two later, and a profitable job quietly borrows more working capital from you until the gap is larger than the profit.
The solution
I begin before works start, off the tender programme and the contract's payment clauses: I spread the cost across the programme to draw the money going out, then layer the payment machinery over the value earned to draw the money coming in. Then I maintain it monthly against actual progress and actual certification, so the curves move as the job does. You see how deep the dip goes and when it recovers, and the next tight month is seen a month or two ahead rather than on the day it bites.
What you receive
You always know the shape of the job's cash, not just today's balance: where it dips, how far, and when it comes back, seen months ahead rather than in the week it hurts. The funding conversation happens before the squeeze, from foresight rather than panic, so a profitable job can no longer surprise you with a cash crisis. The forecast is the thing you plan against, still true the day you need it.
The Handover Pack accompanies the work with its dates and sources, likely outcomes and responses, scope boundaries and ready-to-send correspondence where needed.
Turnaround: five working days per cycle.
The working days start when the agreed scope and required inputs are available. Optional items do not hold the start unless the agreed scope says otherwise.
How it works
You tell me about the job and its programme
One call on the project, the programme and where cash is likely to be tight. The first conversation is free and commits you to nothing.
You send me the programme, the payment terms and the cost build-up
The list below lets the first forecast be built before works start, off the real programme and the contract's actual payment machinery.
- A
Contract sum and build-up
EssentialWithout it: There is no value curve to spread money against, so nothing else in the forecast can be built.
Where to find it: The estimating file, the tender summary or the job budget.
Why I need it: The value being spread
- B
The current accepted programme
EssentialWithout it: The value curve cannot be weighted to real timing, so the model straight-lines the spend and the trough it finds cannot be trusted.
Where to find it: The planner's files, the tender pack, or the last progress report.
Why I need it: What decides when the value is earned
- C
Payment terms and dates
ImportantWithout it: The receipt curve is built on assumed payment dates rather than the real ones, so when the money actually lands could be wrong by weeks.
Where to find it: The contract's payment section, or the order confirmation for a subcontract.
Why I need it: What decides when the money arrives
- D
Actual costs to date
EssentialWithout it: There is nothing to build the cost curve from, so the outgoing side of the forecast cannot be produced.
Where to find it: The cost ledger or job-costing system, or ask whoever manages your accounts for an export to date.
Why I need it: What has actually been spent
- E
Committed costs and orders
ImportantWithout it: The forward cost curve is phased from the tender build-up rather than from what is actually on order, so the timing of spend beyond the ledger date is an estimate, not a fact.
Where to find it: The order register, or your buying team's list of orders placed and not yet invoiced.
Why I need it: What is owed but not yet paid
- F
Retention terms
ImportantWithout it: Retention is modelled on a standard form's percentage and release dates rather than your actual terms, or, where no form is known, the trough is reported before retention is taken off at all.
Where to find it: The contract's payment section, alongside the other payment terms, or ask whoever manages your accounts if it is not stated there.
Why I need it: What is held back and when it comes back
Copies are fine. Send what you have and I'll tell you what's missing. Download the client request PDF or editable Word version to pass to whoever holds the files.
Programme Confirmed Current
The forecast is built only on a programme you confirm in writing as the accepted current version, so the curves reflect the job as it will really run.
- A
I build the forecast before the job starts
Cost spread across the programme as the money going out, receipts shifted right by the payment terms and shaved by retention as the money coming in, the two curves on one page you hold.
Terms From the Contract
The receipts curve runs on the executed contract's own payment dates, each carrying its clause number, never on assumed terms.
I show you where the job is most exposed
The working-capital dip named before a spade is in the ground: how deep, when it starts, when it recovers, so any funding is arranged calmly and in advance.
I update the forecast every month against reality
Actual progress against the programme and actual certification against the applications, so the curves move as the job does and the next tight month is seen ahead of time, each movement carrying its reason.
You act on the tight periods with room to spare
The overdraft arranged, the payment conversation timed, the big material order placed to follow a receipt rather than precede it, all decided from a forecast rather than from the bank balance this morning.
I keep the squeeze seen months ahead
Between projects the service pauses rather than cancels: nothing is re-onboarded, the file and the diary stay warm, and it resumes the day the next project starts.
Free Service Pack
A step-by-step Handbook, with the templates and working documents you need to carry out the work it covers yourself. You supply your own project information and records.
Follow the Handbook's scope and stopping points, and obtain independent advice where required. The pack is not project-specific advice or independent sign-off.
Tips that raise your odds of success
Questions I get asked often
This service forecasts the cash; the margin behind it is reconciled monthly by CVR Production & Maintenance, and the destination the cash is heading for is kept current by Forecast Final Account Maintenance. The receipts side of the forecast assumes the applications go in on time, which is the routine run by Payment Application Assembly & Issuance in the Payments theme.